Holzer Clinic settles 7-year-old whistleblower lawsuit

GALLIPOLIS — Holzer Clinic resolved seven-year-old whistleblower allegations and paid roughly $846,000 to settle a lawsuit that claimed some doctors in the clinic would overcharge federal programs for patient care.

The Columbus Dispatch originally reported the story after the case was officially closed last week.

According to Holzer legal counsel, they “stressed that there has been no determination by the Court that any ‘inappropriate conduct’ actually occurred (to the incident in question), that the allegations made in the complaint never became findings against Holzer Clinic and should not be accepted as facts.”

“Holzer Clinic is pleased to report that it has settled some old litigation initially filed in 2008 regarding certain coding allegations related to services from years earlier. While there was no admission or determination that any inappropriate conduct occurred on the part of Holzer Clinic in the matter, Holzer Clinic believed it was in its best interest to resolve this old litigation so that it could continue to focus on its mission to provide the best care and service to our patients and to the communities we serve,” said a statement issued by the organization.

Former Holzer employees Laura Lovett and Lisa Gregg (formerly Mayhew) filed a qui tam action in U.S. District Court for the Southern District of Ohio versus Holzer Clinic. According to settlement papers, the pair claimed the clinic “submitted or caused to be submitted false claims for payment to the Medicare Program.”

The court granted the clinic’s motion to dismiss in February 2011, but allowed Gregg and Lovett to file an amended complaint. The amended complaint was filed March 2013.

After receiving payment from the clinic, Gregg and Lovett were allegedly bound to no longer dispute or hold the clinic liable for practices they claim to have been fraudulent in nature.

According to information collected by The Columbus Dispatch, the former workers claimed in a complaint that “Holzer management and physicians have developed a business culture within the organization that places a premium on revenue maximization to the detriment of correct and legitimate billing practices.”

According to a 2014 order referenced by The Columbus Dispatch, Judge Michael Watson dismissed a number of allegations against the clinic but felt there was some evidence that may have suggested the organization was using less-than-accurate billing codes to take in more money for the healthcare provider.

Watson was quoted in the order as saying, “The facts establish that: 1) Holzer knew its coding philosophy encouraged upcoding; 2) Holzer knew its coding education was lacking; 3) Holzer knew its audits reflected significant overcoding; 4) Holzer was aware of and concerned about its liability for overcoded claims; and 5) Holzer did not improve coding education despite such knowledge.”

The last signature to have been signed on the legal settlement was that of Mark T. D’Allessandro on Nov. 13.

The U.S. government reportedly received nearly $600,000 of the settlement funds while Gregg and Lovett received around $245,000.